Russian factory activity grew at a slower pace in November, the PMI showed with Reuters

(Reuters) – Employment in all of Russia’s manufacturing sectors rose slightly in November, a business survey showed on Monday, thanks to new growth in output and new laws despite shrinking job vacancies and businesses cutting headcount.

The S&P Global Purchasing Managers’ Index (PMI) for Russian manufacturing rose to 51.3 from 50.6 in October, above the 50 level that separates expansion from contraction.

The rise was partly due to a rebound in new sales, which ended a two-month slump, while demand for goods began to improve, although growth was slower than inventory.

Russia’s heavy spending on arms and weapons since it invaded Ukraine in February 2022 has boosted a manufacturing sector that may have suffered as other countries shunned Moscow.

Gradually, Russian manufacturers have found new markets abroad. New export orders rose for the fourth consecutive month, albeit at a slower pace than in October.

Manufacturers have also registered job losses, the survey showed, with the shortage of workers creating problems in lieu of voluntary resignations.

Unemployment in Russia fell to 2.3% last week, with unemployment hitting all areas of the economy.

Russian companies are also eyeing the ruble, which fell to its lowest level since March 2022 last week, prompting the central bank to intervene in an increase in FX trading.

“Increasing supplier prices and volatile price movements are pushing prices higher, according to panelists,” S&P Global said.

The shopping spree continued.

“Delays for suppliers continued in November, as rail and freight infrastructure were identified by companies as key factors contributing to longer lead times,” S&P Global said.

Driven by the prospect of new business development and current investment, business confidence has increased significantly since June, the survey showed.